Buying Exact Sciences stock – EXAS

I am adding to Exact Sciences (EXAS) positions. I am recommending addition at the open today.

I am listening to the conference call regarding USPSTF rating as I type.

Exact is included in the USPSTF draft ratings in a new category as an “alternative” screening tool to the previously recommended screening tests. Final ratings will be issued late this year or early next year. There is not likely to be any major changes.

USPSTF gave ALL screening tests an “A” rating in both groups for ages 50 to 75. That rating requires mandated insurance coverage.

Interestingly, USPSTF, is looking at a one year interval for Cologuard, which would increase the number of tests Exact sells. There are also discrepancies in the data reported by USPSTF which one would believe would be updated and corrected. I anticipate that the 3 year interval will eventually be adopted as FDA and CMS have.

USPSTF is taking a step by step approach to adding newer tests to the “recommended” category. Over time, stool based DNA with FIT – which is what Cologuard is – and CT Scan (Virtual Colonoscopy) will be added to the “recommended” list. It is important to realize that there is no functional difference between the two groups, other than grouping old vs new.

We already knew that Cologuard would be having follow up studies per FDA and CMS.

The sell-off is an over reaction and has been accelerated by rabid networked shorts in a low volume under pressure stock market that is being impacted by internet rumor. Use this to make EXAS a full or double position. For the very aggressive, you can make EXAS a triple position. I am looking at LEAPs, however, given the volatile nature of EXAS and high price of options am not sure I will find an opportunity given I believe the general market is in a bear market that will be shallow, but potentially sustained for a while.

Kirk Spano

Fundamental Trends

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